Life insurance claims get routinely denied by large insurance companies. Certainly, not all life insurance claims are incorrectly denied. In this blog, we are writing only about those life insurance claims that have been wrongfully denied.
Wrongfully denied life insurance claims can be collected with the help of an experienced life insurance attorney. At our firm, we represent beneficiaries whose life insurance claims have been denied for different reasons, including misrepresentations made on an application for life insurance.
When people take out life insurance, they are asked to answer several questions about their health and medical history. Such questions may ask an applicant about specific diseases, diagnostic tests and medication or they may be vague and group diseases into categories.
Answers to these questions are assessed by the insurance company when it evaluates the risk involved in insuring a particular individual. If a policy is issued based on the answers provided and the insured dies within the first two years of the policy effective date, the insurance company has a right to contest it, or request the insured’s medical records to check if the answers were truthful.
Contestability is a process of collecting an insured’s medical, employment and background information in cases where the insured died within the first two years of the policy issue date.
This information is then used by the insurance company to evaluate the truthfulness of the answers provided on the application for life insurance. State statutes give insurers a right to cancel a life insurance policy if it was issued to an individual in reliance on incorrect information provided in an application.
However, a policy can be rescinded only if misrepresentations on the application are material. In other words, a policy will be cancelled if an insurer can prove that it would not have issued the policy if it had known the correct information.
If an answer appears to be false, the insurance company has a right to rescind the policy and deny the claim for life insurance benefits. This is true even in cases where an applicant disclosed the medical history in good faith, but made an innocent mistake in one of the answers.
The way the questions are often phrased on life insurance applications may confuse many applicants for life insurance. For example, an applicant may know his/her diagnosis but may not necessarily know that it belongs to a category of the diseases as outlined in the application.
At our law firm, we have successfully handled many denied life insurance claims based on material misrepresentations on the application. In almost all of these cases, the insureds disclosed their medical history truthfully, but were confused about the wording of a question.
There is legal recourse for a denied life insurance claim based on material misrepresentations. If a claim is wrongfully denied, there is a chance to recover life insurance benefits in court or through negotiations with the insurance company.
Call (888) 510-2212 for a free consultation.